The Automation Potential Analysis for the Finance Department

The pressure to digitalise in the finance sector is palpable. Management expects efficiency gains, and new technologies promise solutions. Many finance teams react by procuring the first available tool or attempting to automate the most painful process. A well-founded automation potential analysis finance department is rarely conducted. This impulse is understandable, but it often leads to disappointing results. Investments do not pay off, and the hoped-for relief fails to materialise. The reason is usually that the wrong process was tackled.

The Difference Between Actionism and Strategy

Introducing new software or automating a single, isolated work step is often pure actionism. It is a reaction to an acute pain point without considering the overall system. Perhaps the creation of a specific report is accelerated. However, the fundamental problems such as data quality, manual interfaces, or a lack of transparency often remain. The result is a selective improvement that carries little weight in the overall context.

A strategic approach asks a different question. It asks: 'Which automation creates the greatest value for the company?'. This requires taking a step back. It is about understanding the entire chain of financial processes — from the ERP export and processing in Excel to the final reporting and regulatory filings. A strategic decision is based on an analysis that assesses the dependencies and the influence of each individual link in this chain.

The market for automation solutions is growing rapidly. According to one study, 53 per cent of companies already use artificial intelligence in accounting or are preparing to introduce it (KPMG 2025). This trend increases the pressure to act. At the same time, it increases the risk of misguided investments if decisions are made hastily and without a solid analytical basis. Careful planning is an important prerequisite for success under these circumstances.

What a Potential Analysis Achieves — and What It Does Not

A potential analysis is not a technical concept. It does not deliver ready-made software, nor does it replace the expertise of the finance team. Its purpose is not to sell a specific solution. It is primarily an advisory instrument that creates clarity and a basis for decision-making. It focuses on one crucial question: Where is the greatest leverage for automation in your specific situation?

The analysis identifies the process whose automation has the most positive impact on the entire company. This could be a process that is particularly time-consuming. However, it could also be a process that carries a high risk of error or whose outcome is critical for important strategic decisions. The analysis evaluates these factors and makes them comparable.

One can imagine the financial processes as a chain. 'The chain' extends from the data export from the source system to the final management presentation. A potential analysis examines every link in this chain. The analysis looks for the weakest link in the chain. It does not primarily focus on the easiest link to replace. Strengthening the weakest link is often the most effective way to contribute to the performance of the entire chain.

The Criteria for a Good Analysis

An assessment that focuses mainly on the working hours saved falls short. A well-founded analysis is based on several, clearly defined criteria to comprehensively evaluate the potential of a process. This is an important basis for deriving a robust and defensible recommendation.

• Frequency and volume: How often is a process performed? Daily or weekly tasks often have higher potential than annual ones. At the same time, the volume of data processed plays a role. Large amounts of data are more prone to manual errors and more time-consuming to handle.
• Error-proneness and risk: Where can human errors occur and what are their consequences? A typo in an internal analysis is annoying. An error in the VAT return or in the report to the board of directors can be costly and cause reputational damage.
• Complexity and standardisation: How many manual steps, systems, and people are involved? Complex workflows with many handovers are good candidates. It is important to determine whether the process follows a clear logic or requires recurring human judgement. Meaningful automation generally requires standardisable processes.
• Strategic value and dependencies: How important is the outcome of the process for corporate management? An automation that delivers faster and more reliable data for forecasting has a higher strategic value than accelerating a purely administrative procedure. In addition, one must examine which other reports depend on this process.

The combination of these criteria provides a complete picture. It enables a decision that goes beyond mere time savings and considers the strategic contribution to the company's development.

The Analysis Process in Practice

The starting point of a potential analysis is understanding the current situation. The as-is state is determined in discussions and workshops with key individuals in the finance department. It is important to capture the lived reality. The theory described in the manual is often not enough. Which Excel files are in circulation? Where does the data come from, and where does it go?

The collected information is visualised, often in the form of process diagrams. This representation makes the workflows and, in particular, the interfaces and media disruptions visible. Often, an initial common understanding of where the actual problems lie emerges within the team at this stage. This visualisation is the basis for the subsequent evaluation.

Each identified sub-process is then systematically evaluated based on the defined criteria. The result is a ranking. It shows which processes have the greatest potential for value-adding automation. This evaluation is structured and comprehensible. It transforms a gut feeling into a fact-based foundation for decision-making.

The automation of Excel processes is a way to integrate these often isolated spreadsheets into company-wide systems. They thereby become another reliable and integrable data source (Automation Anywhere 2024). A potential analysis ensures that precisely those Excel processes are tackled whose integration will create the greatest benefit. The result is a short report that makes a recommendation and justifies it.

What You Can Do This Month

You do not have to wait for an external partner to take the first step. You and your team can carry out a simple exercise yourselves as early as next week. It creates an initial foundation and raises awareness of the topic.

Take an hour and create a list. Note down all the recurring tasks that your team performs monthly or quarterly in Excel. These could be consolidations, reports, accruals, or plausibility checks.

Go through this list and estimate the approximate time required for each task per month. An exact measurement is not necessary; a rough estimate in hours is sufficient. Write this number next to each task.

For each task, ask yourself one last question: 'What is the worst conceivable damage if an error occurs in this task?'. The answer will give you an indication of the risk and the strategic value. A high time commitment combined with high potential for damage points to a promising candidate for a more in-depth analysis. This exercise already provides valuable initial insights.

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